Govt's Fiscal Deficit Touches 63.6 Per Cent Of Revised Target In January

Comparatively, during the same period last year, the fiscal deficit was at 67.8 per cent of the Revised Estimates (RE) of the Union Budget 2022-23

The government's fiscal deficit reached Rs 11 lakh crore by the end of January, marking 63.6 per cent of the revised annual target, as per official data released on Thursday. Comparatively, during the same period last year, the fiscal deficit was at 67.8 per cent of the Revised Estimates (RE) of the Union Budget 2022-23. For the fiscal year 2023-24, the government's estimated fiscal deficit stands at Rs 17.35 lakh crore, equivalent to 5.8 per cent of the GDP.

According to data from the Controller General of Accounts (CGA), the government's total receipts amounted to Rs 22.52 lakh crore by January 2024, representing 81.7 per cent of the corresponding RE 2023-24 of total receipts. This included Rs 18.8 lakh crore in tax revenue (net), Rs 3.38 lakh crore of non-tax revenue, and Rs 34,219 crore of non-debt capital receipts, which consist of loan recovery and miscellaneous capital receipts.

Meanwhile, the total expenditure incurred by the Centre was Rs 33.54 lakh crore, with Rs 26.33 lakh crore allocated to revenue account and Rs 7.2 lakh crore to capital account, constituting 74.7 per cent of the corresponding RE 2023-24.

The CGA data also indicates that Rs 8,20,250 crore has been transferred to state governments as devolution of share of taxes by the central government up to this period, which is Rs 1,52,480 crore higher than the previous year. Of the total revenue expenditure, Rs 8,21,731 crore was spent on interest payments and Rs 3,15,559 crore on major subsidies.

Chief Economist at ICRA, Aditi Nayar, commented on the data, expressing that while there might be some slippage in the disinvestment target and capital expenditure may lag behind the FY24 RE, ICRA does not anticipate breaching the revised fiscal deficit target of Rs 17.3 lakh crore for FY24.

The interim Budget presented by Prime Minister Narendra Modi's government refrained from announcing populist measures, with expectations to reduce the fiscal deficit to 5.1 per cent of the GDP next fiscal year and 4.5 per cent in FY26.

The nominal GDP growth for the upcoming financial year has been projected at 10.5 per cent, lower than the earlier estimate of 11 per cent. Overall, aided by improved tax buoyancy, the government achieved a fiscal deficit of 5.8 per cent, slightly better than the Budget Estimate of 5.9 per cent for the current financial year.